Holiday Inn 2009 Annual Report Download - page 104

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102 IHG Annual Report and Financial Statements 2009
28 Issued share capital and reserves
Equity share capital
At 30 September 2009, the authorised share capital was £160,050,000, comprising 1,175,000,000 ordinary shares of 13 29⁄47p each and one
redeemable preference share of £50,000. As a result of the resolution passed at the Annual General Meeting on 29 May 2009 amending the
Articles of Association in line with the Companies Act 2006, from 1 October 2009 the Company no longer has authorised share capital.
Number of Nominal Share Equity share
shares value premium capital
millions $m $m $m
Allotted, called up and fully paid (ordinary shares of 13 29⁄47p)
At 1 January 2008 295 81 82 163
Issued on exercise of share options ––22
Repurchased and cancelled under repurchase programmes (9) (3) – (3)
Exchange adjustments – (21) (23) (44)
At 31 December 2008 286 57 61 118
Issued on exercise of share options 1 – 11 11
Exchange adjustments – 6 7 13
At 31 December 2009 287 63 79 142
During 2008, 9,219,325 ordinary shares were repurchased and cancelled under the authorities granted by shareholders at an Extraordinary
General Meeting held on 1 June 2007 and at the Annual General Meeting held on 30 May 2008. The Company deferred its £150m share
repurchase programme in November 2008 in order to preserve cash and maintain the strength of the Group’s financial position. No shares
were repurchased in 2009.
The authority given to the Company at the Annual General Meeting on 29 May 2009 to purchase its own shares was still valid at
31 December 2009. A resolution to renew the authority will be put to shareholders at the Annual General Meeting on 28 May 2010.
The balance classified as equity share capital includes the total net proceeds (both nominal value and share premium) on issue of the
Company’s equity share capital, comprising 13 29⁄47p shares. The share premium reserve represents the amount of proceeds received
for shares in excess of their nominal value.
The nature and purpose of the other reserves shown in the Group statement of changes in equity on page 62 of the financial statements
is as follows:
Capital redemption reserve
This reserve maintains the nominal value of the equity share capital of the Company when shares are repurchased or cancelled.
Shares held by employee share trusts
Comprises $3.8m (2008 $49.2m) in respect of 0.3m (2008 3.0m) InterContinental Hotels Group PLC ordinary shares held by employee share
trusts, with a market value at 31 December 2009 of $4m (2008 $25m).
Other reserves
Comprises the merger and revaluation reserves previously recognised under UK GAAP, together with the reserve arising as a consequence
of the Group’s capital reorganisation in June 2005. Following the change in presentational currency to the US dollar in 2008 (see page 65),
this reserve also includes exchange differences arising on the retranslation to period-end exchange rates of equity share capital, the
capital redemption reserve and shares held by employee share trusts.
Unrealised gains and losses reserve
This reserve records movements to fair value of available-for-sale financial assets and the effective portion of the cumulative net change
in the fair value of the cash flow hedging instruments related to hedged transactions that have not yet occurred.
The fair value of cash flow hedging instruments outstanding at 31 December 2009 was a $7m liability (2008 $10m liability).
Currency translation reserve
This reserve records the movement in exchange differences arising from the translation of the financial statements of foreign operations
and exchange differences on foreign currency borrowings and derivative instruments that provide a hedge against net investments
in foreign operations. On adoption of IFRS, cumulative exchange differences were deemed to be $nil as permitted by IFRS 1.
During the year ended 31 December 2009, the impact of hedging net investments in foreign operations was to increase the amount
recorded in the currency translation reserve by $8m (2008 reduce by $96m). The fair value of derivative instruments designated as
hedges of net investments in foreign operations outstanding at 31 December 2009 was a $13m liability (2008 $nil).
Notes to the Group financial statements continued